Today’s Canadian retail weather report – it’s mixed!
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Canada’s cannabis retail sector has reached its one year anniversary. Brands have been developed, stores have been opened, and product has been sold – but it hasn’t turned out exactly as anticipated.
A year ago, on November 16, 2018, 20 days after legalization, we invited four leaders in this then-brand new retail sector to share their perspective with us. For this year’s session, one of them returned and we included two new panel members to see what our now-veteran cannabis retailers are dealing with, and what we can learn from it. This year’s topics shifted to Product, Competition, and People, with Regulation touching on many of these areas. Joining me on stage was our “Retail Cannabis Retail One Year Later” panel, including :
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Retail sales continue to grow, and recovered in June from the May dip with core retail sales (excluding automotive) YoY growth increase of .89% in May increasing to 2.45% in June. Canada added 81,100 jobs in August after losing 24,200 in July. Business confidence increased in August to its highest point since October 2018 and consumer confidence also increased from July to August.
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Canada’s economy is showing encouraging signs. The unemployment rate in May was at its lowest since 1976, with business confidence at its highest since January. On May 21, the Conference Board of Canada reported that consumer spending was bouncing back and there were signs business investing was starting to grow. The GDP continues to grow YoY in line with predictions.
There is still massive growth predicted — from $151M in the first 2 ½ months of sales to over $5B in annual sales by the end of 2021. And the industry is still in startup mode as regulations develop and change, products advance as a result, and brands build.
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Canada gained an entirely new retail sub-sector last year – one that delivered $151M in sales in its first 2½ months of operation despite major supply issues, and in combination with the edibles to be legalized in 2019, is now predicted by the Brightfield Group to deliver $5B in annual sales by the end of 2021.
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